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‘Angel-investor’ tax break comes into effect

A tax break for people who invest in innovative start-up companies, known as ‘angel-investor’ relief, has come into effect. 

The measure offers a reduced rate of capital-gains tax (CGT) for individuals who invest in qualifying start-ups. 

The Department of Finance says that the move aims to help start-up SMEs to attract investment and to make Ireland a more attractive location for business angel investors.  

The relief offers a reduced rate of CGT of 16% for individual investors, or 18% in the case of an investment through a qualifying partnership, on the sale of that investment to a third party. 

Three-year period 

The reduced CGT rate is available on a gain up to a maximum of twice the value of the investor’s initial investment.  

The qualifying investment in eligible shares must be made before 31 December 2026. The shares must be held by the qualifying investor for at least three years before the disposal. 

Minister for Finance Paschal Donohoe has commenced the measure, which was introduced by section 54 of the Finance Act 2024, from 1 March. 

Revenue has now published more information on the measure – including details of how companies can apply for a certificate of qualification for the scheme.